Advanced Performance Physical Therapy and Rehabilitation Inc., DAB CR6730 (2025)

DECISION

Advanced Performance Physical Therapy and Rehabilitation Inc. (Petitioner) challenges the Centers for Medicare & Medicaid Services’ (CMS’s) determination of its effective date of reactivation as a biller to the Medicare program following a period of deactivation due to its failure to revalidate.  As explained below, I find CMS properly determined October 13, 2024 as the revalidation effective date of Petitioner’s Medicare enrollment, as that is the date the Medicare administrative contractor received Petitioner’s revalidation application that was processed to approval. 

I. Background

Petitioner is a physical/occupational therapy practice that has been enrolled as a Medicare supplier beginning August 1, 2006.  CMS Ex. 1 at 2-4.  On April 18, 2024, CMS contractor Noridian Healthcare Solutions (Noridian) advised Petitioner that it was obligated to revalidate its Medicare enrollment by July 31, 2024.  CMS Ex. 2.  The letter informed Petitioner that it could submit its revalidation application either online through the Medicare Provider Enrollment, Chain, and Ownership System (PECOS) or by mail.

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Id.  The letter, which was mailed to Petitioner, further warned Petitioner that “[i]f we don’t receive your response by then, we may stop your Medicare billing privileges.”  Id.

On September 5, 2024, Noridian deactivated Petitioner’s Medicare billing privileges effective August 1, 2024.  CMS Ex. 3.  As the basis for the deactivation, Noridian stated that Petitioner failed to submit a timely revalidation application.  Id. (citing 42 C.F.R. § 424.540(a)(3)).  Noridian further advised Petitioner of its right to file a rebuttal if Petitioner believed the deactivation determination was incorrect.  Id. 

On September 18, 2024 and September 25, 2024, Caleb Stewart, MPT, DPT, OCS, Petitioner’s owner, contacted Noridian by email and advised that he had not “received any requests prior to 9/16/24, and [] only knew that the billing privileges were deactivated” following a conversation to enroll another therapist.  CMS Ex. 4.  Dr. Stewart further advised that he “will begin the process of revalidation through the PECOS site.”  Id.  

On October 13, 2024, Noridian received a revalidation application from Petitioner.  CMS Ex. 6.  Noridian subsequently approved Petitioner’s application with an effective date of October 13, 2024.  CMS Ex. 8 at 1.  Noridian also advised Petitioner that there would be a gap in billing privileges from August 1, 2024 to October 12, 2024.  Id. 

Petitioner thereafter filed a request for reconsideration of the deactivation and the gap in billing privileges.  CMS Ex. 9.  Petitioner specifically averred that it had not received the revalidation request prior to its billing privileges being deactivated.  Id. at 1.  Petitioner further asserted that the deactivation caused his practice financial hardship.  Id.  On March 3, 2025, Noridian issued a reconsidered determination and found no error in reactivating Petitioner’s Medicare billing privileges as of October 13, 2024, with a billing gap from August 1, 2024 to October 12, 2024.  CMS Ex. 12. 

On March 28, 2025, Petitioner timely requested a hearing to dispute the reconsidered determination.  DAB E-File Doc. Nos. 1-1d.  On March 31, 2025, the undersigned Administrative Law Judge (ALJ) was designated to hear and decide this case.  Id. at Doc. No. 2.  That same day, the Civil Remedies Division (CRD) acknowledged the hearing request and issued my Standing Pre-hearing Order (Standing Order).  Id. at Doc. No. 2a.  Among other things, the Standing Order instructed the parties to file pre-hearing exchanges by specified dates.  Id. 

On May 5, 2025, CMS timely filed a motion for summary judgment and pre-hearing brief (CMS Br.) and thirteen proposed exhibits (CMS Exs. 1-13).  Id. at Doc. Nos. 6-6n.  On June 9, 2025, Petitioner timely filed a pre-hearing brief and response to CMS’s motion for summary judgement (P. Br.) and eight proposed exhibits (P. Exs. 1-8).  Id. at Doc. Nos. 7-16.  On June 18, 2025, CMS filed its rebuttal to Petitioner’s pre-hearing brief.  Id. at Doc. No. 17.  

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II. Admission of Exhibits and Decision on the Record

Petitioner did not object to CMS Exs. 1 through 13.  In the absence of objections, I admit CMS Exs. 1 through 13 into the record. 

Petitioner has submitted eight proposed exhibits.  Although CMS did not object to Petitioner’s exhibits, I “must exclude ‘new documentary evidence’ – that is, documentary evidence that a provider did not previously submit to CMS at the reconsideration stage (or earlier) – unless [I] determine[] that ‘the provider or supplier has good cause for submitting the evidence for the first time at the ALJ level.’”  Care Pro Home Health, Inc., DAB No. 2723 at 11 (2016) (citing 42 C.F.R. § 498.56(e)(1)). 

At the outset, Petitioner has submitted affidavits from Nikki Force and Laura Ramos.  P. Exs. 4, 5.   In the absence of objection from CMS, I admit the affidavits into evidence as the individuals’ written direct testimony.  Arkady B. Stern, M.D., DAB No. 2329 at 4 n.4 (2010) (“Testimonial evidence that is submitted in written form in lieu of live in-person testimony is not ‘documentary evidence’ within the meaning of 42 C.F.R. § 498.56(e), which requires good cause for submitting new documentary evidence to the ALJ.”).  In addition, as it appears that the remaining documents submitted by Petitioner are from the proceedings below, P. Exs. 1-3 and 6-8 are admitted into the record. 

If the parties wanted an in-person hearing, the parties had to submit written direct testimony from the witnesses and the opposing party had to request to cross-examine one or more of those witnesses.  Standing Order ¶¶ 11-13; Civil Remedies Division Procedures (CRDP) §§ 16(b), 19(b). 

Because neither party has requested cross-examination, I do not need to hold a hearing and may issue a decision based on the written record.  Vandalia Park, DAB No. 1940 (2004).  Therefore, I deny CMS’s motion for summary judgment as moot.  In rendering this decision on the record, I address the matters raised by Petitioner in its hearing request. 

III. Issue

Whether CMS had a legitimate basis to establish October 13, 2024, as the effective date of Petitioner’s reactivated Medicare billing privileges.  

IV. Jurisdiction

I have jurisdiction to decide this case.  42 C.F.R. §§ 498.3(b)(15), 498.5(l)(2).  

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V. Findings of Fact, Conclusions of Law, and Analysis1

A. Applicable Law

1. Enrollment

Petitioner participates in the Medicare program as a “supplier” of services.  Social Security Act (Act) § 1861(d); 42 C.F.R. § 498.2.  To receive Medicare payments for the services it furnishes to program beneficiaries, a prospective supplier must enroll in the program.  42 C.F.R. § 424.505.  “Enrollment” is the process by which CMS and its contractors:  (1) identify the prospective supplier; (2) validate the supplier’s eligibility to provide items or services to Medicare beneficiaries; (3) identify and confirm a supplier’s owners and practice location; and (4) grant the supplier Medicare billing privileges.  42 C.F.R. § 424.502. 

To enroll, a prospective supplier must complete and submit an enrollment application.  42 C.F.R. §§ 424.510(d)(1), 424.515(a).  An enrollment application is either a CMS‑approved paper application or an electronic process approved by the Office of Management and Budget.  42 C.F.R. § 424.502.  When CMS determines a prospective supplier meets the applicable enrollment requirements, it grants Medicare billing privileges, which means that the supplier can submit claims and receive payments from Medicare for covered services provided to program beneficiaries.  42 C.F.R. § 424.505. 

The effective date for its billing privileges “is the later of the date of filing” a subsequently approved enrollment application or “[t]he date that the . . . supplier first began furnishing services at a new practice location.”  42 C.F.R. § 424.520(d)(1) (emphasis added).  The “date of filing” is the date that the Medicare contractor “receives” a signed enrollment application that the Medicare contractor is able to process to approval.  73 Fed. Reg. 69,726, 69,769 (Nov. 19, 2008); Donald Dolce, M.D., DAB No. 2685 at 8 (2016).  If a supplier satisfies certain requirements, CMS may allow a supplier to bill retrospectively for up to 30 days prior to the effective date.  42 C.F.R. § 424.521(a)(1). 

2. Revalidation

To maintain billing privileges, a supplier must resubmit and recertify the accuracy of its enrollment information at least every five years, a process referred to as “revalidation.”  42 C.F.R. § 424.515.  Beyond these periodic revalidations, CMS may, at other times and for its own reasons, ask a supplier to recertify the accuracy of its enrollment information.  42 C.F.R. § 424.515(d).  Within 60 days of receiving CMS’s notice to recertify, the

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supplier must submit an appropriate enrollment application with complete and accurate information and supporting documentation.  42 C.F.R. § 424.515(a)(2). 

3. Deactivation

The regulation authorizing deactivation explains that “deactivation [of Medicare billing privileges] is intended to protect the provider or supplier from the misuse of its billing number and to protect the Medicare Trust Funds from unnecessary overpayments.”  

86 Fed. Reg. 62,240, 62,359 (Nov. 9, 2021).  CMS is authorized to deactivate an enrolled supplier’s Medicare billing privileges if the enrollee does not “furnish complete and accurate information and all supporting documentation within 90 calendar days of receipt of notification from CMS to submit an enrollment application and supporting documentation, or resubmit and certify to the accuracy of its enrollment information.”  42 C.F.R. § 424.540(a)(3).  If CMS deactivates a supplier’s Medicare billing privileges, “[n]o payment may be made for otherwise Medicare covered items or services furnished to a Medicare beneficiary.”  42 C.F.R. § 424.555(b); see also 42 C.F.R. § 424.540(e). 

4. Reactivation

The reactivation of an enrolled supplier’s billing privileges is governed by 42 C.F.R. § 424.540(b).  The process for reactivation is contingent on the reason for deactivation.  If CMS deactivates a supplier’s billing privileges due to a reason other than nonsubmission of a claim, the supplier must apply for CMS to reactivate its Medicare billing privileges by completing and submitting the appropriate enrollment application(s) or recertifying its enrollment information, if deemed appropriate.  42 C.F.R. § 424.540(a)(3), (b)(1); 71 Fed. Reg. 20,754, 20,762 (Apr. 21, 2006).  The effective date of a reactivation of billing privileges, following a period of deactivation, is the date on which the Medicare contractor received the supplier’s submission that was processed to approval.  42 C.F.R. § 424.540(d)(2). 

B. Analysis

1. Noridian received Petitioner’s reactivation enrollment application on October 13, 2024 that was processed to approval, which is the effective date of its Medicare reactivated enrollment. 

As discussed above, the effective date of a reactivation of Medicare billing privileges is the date on which the Medicare contractor received the supplier’s submission that was subsequently processed to approval.  Id. 

In this case, Noridian received a reactivation/revalidation enrollment application from Petitioner on October 13, 2024, and this application was processed to approval.  CMS Exs. 6, 8.  Noridian thus appropriately found the effective date of Medicare billing

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privileges for Petitioner to be October 13, 2024, the date of receipt of the Medicare application that was subsequently approved by the contractor with a gap in billing privileges from August 1, 2024 to October 12, 2024.  CMS Exs. 8, 12.  Moreover, there is no evidence in the record before me of an application submitted earlier than the one Petitioner submitted on October 13, 2024, that Noridian received and subsequently approved. 

Therefore, pursuant to 42 C.F.R. § 424.540(d)(2), the date Noridian received Petitioner’s subsequently-approved reactivation enrollment application – October 13, 2024 – is the correct effective date of enrollment.  Michael B. Zafrani, M.D., DAB No. 3075 at 2 n.1 (2022).  

2.  I have no authority to review the deactivation of Petitioner’s billing privileges and cannot afford it equitable relief. 

In its brief, Petitioner generally contends that Noridian erred in deactivating its Medicare billing privileges, which resulted in a gap of billing privileges from August 1, 2024 to October 12, 2024.  P. Br. at 1-4.  Petitioner specifically states it: 

never received the revalidation notice as required by Medicare’s own guidelines.  I revalidated as soon as I was aware of the notice, as evidenced by the receipt on Oct 13, 2024.  Calculating the day of my receipt of the letter on approximately Sept 12, it took us 1 month to submit all paperwork for revalidation.  If the original CMS revalidation request (claimed to have been sent) had been received, we would have processed it in approximately the same time.  This would have then been completed well within the deadline of July 31, 2024. 

Id. at 4. 

While I acknowledge Petitioner’s argument, I have no authority to review Noridian’s deactivation of Petitioner’s Medicare billing privileges.  CMS Ex. 3; Howard M. Sokoloff, DPM, MS, Inc., DAB No. 2972 at 6 (2019); Wishon Radiological Med. Grp., Inc., DAB No. 2941 at 6-7 (2019); Ark. Health Grp. d/b/a Baptist Health Family Clinic Lakewood, DAB No. 2929 at 7-9 (2019); James Shepard, M.D., DAB No. 2793 at 8 (2017).  That is because the lack of notice is only relevant, if at all, to whether Noridian acted properly in deactivating Petitioner’s billing privileges.  Deactivation decisions in fact have an altogether separate review process that requires a provider or supplier dissatisfied with deactivation to file a rebuttal with CMS’s administrative contractor.  42 C.F.R. §§ 424.545(b), 424.546.  It is not clear from the record whether Petitioner sought relief from Noridian through this rebuttal process.  However, my jurisdiction in

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this case is limited to reviewing the effective date of the approval of Petitioner’s reactivation enrollment application.  42 C.F.R. § 498.3(b)(15). 

Thus, even if Petitioner never received notice, this would not be a basis to grant an earlier effective date.  As an appellate panel of the Departmental Appeals Board (DAB) observed in James Shepard, M.D., DAB No. 2793 (2017), providers and suppliers may not challenge indirectly an action for which the regulations prohibit direct administrative review.  Id. at 8.  In Shepard, the panel held that the supplier could not obtain review of a CMS contractor’s rejection of a previous enrollment application by challenging the effective date of enrollment based on a later approved application.  Id.  For the same reasons articulated by the panel in Shepard, Petitioner’s arguments in the present case amount to a backdoor challenge to a contractor determination—here, deactivation—for which there are no administrative appeal rights.  See id.

Nor may I direct the contractor to allow retrospective reimbursement during the gap in billing privileges from August 1, 2024 through October 12, 2024.  A supplier may not receive payment for services or items furnished while deactivated.  42 C.F.R. §§ 424.540(e), 424.555(b).  This represents a departure; CMS previously permitted retrospective billing after reactivation.  In promulgating the new regulation, the Secretary explained the change:  

After careful reflection . . . the most sensible approach from a program integrity perspective is to prohibit such payments altogether.  In our view, a provider or supplier should not be effectively rewarded for its non-adherence to enrollment requirements (for example, failing to respond to a revalidation request or failing to timely report enrollment information changes) by receiving payment for services or items furnished while out of compliance. 

86 Fed. Reg. 62,240, 62,359-60 (Nov. 9, 2021); see Michael B. Zafrani, M.D., DAB No. 3075 at 2 n.1. 

Lastly, I have no authority to review CMS’s revalidation process or otherwise grant Petitioner any form of equitable relief.  See, e.g., US Ultrasound, DAB No. 2302 at 8 (2010) (“Neither the ALJ nor the Board is authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements.”); Pepper Hill Nursing & Rehab. Ctr., LLC, DAB No. 2395 at 11 (2011) (holding that the ALJ and Board were not authorized to provide equitable relief by reimbursing or enrolling a supplier who does not meet statutory or regulatory requirements); UpturnCare Co., d/b/a Accessible Home Health Care, DAB No. 2632 at 19 (2015) (providing the Board may not overturn the denial of provider enrollment in Medicare on equitable grounds).  While I am mindful and sympathetic to the fact that

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Petitioner’s practice has suffered a significant loss of income while rendering services to the Medicare program, I have no authority under the law to revise the effective date of reactivation determined by CMS. 

VI. Conclusion

Because Noridian received the reactivation application that was processed to approval on October 13, 2024, that same date is the earliest possible effective date.  See 42 C.F.R. § 424.540(d)(2).  

I may not review the deactivation.  

Retrospective reimbursement is not available for those whose enrollment has been deactivated.  42 C.F.R. § 424.540(e).